tgt-20240803



UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 3, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission File Number 1-6049

TARGET CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota

(State or other jurisdiction of incorporation or organization)

1000 Nicollet Mall, Minneapolis, Minnesota

(Address of principal executive offices)

41-0215170

(I.R.S. Employer Identification No.)

55403

(Zip Code)

612-304-6073

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.0833 per share

TGT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Total shares of common stock, par value $0.0833, outstanding at August 23, 2024, were 460,674,666.


						Table of Contents
						Index to Notes

TARGET CORPORATION

TABLE OF CONTENTS


PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Consolidated Statements of Operations	1
	Consolidated Statements of Comprehensive Income	2
	Consolidated Statements of Financial Position	3
	Consolidated Statements of Cash Flows	4
	Consolidated Statements of Shareholders’ Investment	5
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 4.	Controls and Procedures	23

PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	24
Item 1A.	Risk Factors	24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	24
Item 3.	Defaults Upon Senior Securities	24
Item 4.	Mine Safety Disclosures	24
Item 5.	Other Information	24
Item 6.	Exhibits	25

Signatures		26


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements


Consolidated Statements of Operations
	Three Months Ended				Six Months Ended
(millions, except per share data) (unaudited)	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Sales	$	25,021	$	24,384	$	49,164	$	49,332
Other revenue	431		389		819		763
Total revenue	25,452		24,773		49,983		50,095
Cost of sales	17,799		17,798		35,248		36,184
Selling, general and administrative expenses	5,392		5,184		10,560		10,209
Depreciation and amortization (exclusive of depreciation included in cost of sales)	626		594		1,244		1,177
Operating income	1,635		1,197		2,931		2,525
Net interest expense	110		141		216		288
Net other income	(20)		(16)		(49)		(39)
Earnings before income taxes	1,545		1,072		2,764		2,276
Provision for income taxes	353		237		630		491


Net earnings	$	1,192	$	835	$	2,134	$	1,785



Basic earnings per share	$	2.58	$	1.81	$	4.62	$	3.87



Diluted earnings per share	$	2.57	$	1.80	$	4.60	$	3.86
Weighted average common shares outstanding
Basic	462.5		461.6		462.4		461.3
Diluted	463.5		462.5		463.7		462.7
Antidilutive shares	2.3		2.9		1.8		2.4

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q2 2024 Form 10-Q			1


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Comprehensive Income
	Three Months Ended				Six Months Ended
(millions) (unaudited)	August 3, 2024		July 29, 2023		August 3, 2024		July 29, 2023
Net earnings	$	1,192	$	835	$	2,134	$	1,785
Other comprehensive (loss) / income, net of tax
Pension benefit liabilities	—		1		—		3
Cash flow hedges and currency translation adjustment	(5)		(4)		(10)		(9)
Other comprehensive loss	(5)		(3)		(10)		(6)
Comprehensive income	$	1,187	$	832	$	2,124	$	1,779

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q2 2024 Form 10-Q			2


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Financial Position
(millions, except footnotes) (unaudited)	August 3, 2024		February 3, 2024		July 29, 2023
Assets
Cash and cash equivalents	$	3,497	$	3,805	$	1,617
Inventory	12,604		11,886		12,684
Other current assets	1,817		1,807		1,797
Total current assets	17,918		17,498		16,098
Property and equipment
Land	6,645		6,547		6,504
Buildings and improvements	38,324		37,066		35,889
Fixtures and equipment	8,690		8,765		7,936
Computer hardware and software	3,437		3,428		3,178
Construction-in-progress	830		1,703		2,641
Accumulated depreciation	(24,851)		(24,413)		(23,201)
Property and equipment, net	33,075		33,096		32,947
Operating lease assets	3,545		3,362		2,840
Other noncurrent assets	1,457		1,400		1,321
Total assets	$	55,995	$	55,356	$	53,206
Liabilities and shareholders’ investment
Accounts payable	$	12,595	$	12,098	$	12,278
Accrued and other current liabilities	5,749		6,090		5,948
Current portion of long-term debt and other borrowings	1,640		1,116		1,106
Total current liabilities	19,984		19,304		19,332
Long-term debt and other borrowings	13,654		14,922		14,926
Noncurrent operating lease liabilities	3,444		3,279		2,798
Deferred income taxes	2,495		2,480		2,334
Other noncurrent liabilities	1,989		1,939		1,826
Total noncurrent liabilities	21,582		22,620		21,884
Shareholders’ investment
Common stock	38		38		38
Additional paid-in capital	6,831		6,761		6,610
Retained earnings	8,030		7,093		5,767
Accumulated other comprehensive loss	(470)		(460)		(425)
Total shareholders’ investment	14,429		13,432		11,990
Total liabilities and shareholders’ investment	$	55,995	$	55,356	$	53,206

Common Stock Authorized 6,000,000,000 shares, $0.0833 par value; 461,600,215, 461,675,441, and 461,600,640 shares issued and outstanding as of August 3, 2024, February 3, 2024, and July 29, 2023, respectively.

Preferred Stock Authorized 5,000,000 shares, $0.01 par value; no shares were issued or outstanding during any period presented.

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q2 2024 Form 10-Q			3


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Cash Flows
	Six Months Ended
(millions) (unaudited)	August 3, 2024		July 29, 2023
Operating activities
Net earnings	$	2,134	$	1,785


Adjustments to reconcile net earnings to cash provided by operating activities:
Depreciation and amortization	1,461		1,350
Share-based compensation expense	149		107
Deferred income taxes	16		141

Noncash losses / (gains) and other, net	22		11
Changes in operating accounts:
Inventory	(718)		815
Other assets	(53)		62
Accounts payable	522		(1,137)
Accrued and other liabilities	(194)		264


Cash provided by operating activities	3,339		3,398
Investing activities
Expenditures for property and equipment	(1,313)		(2,825)
Proceeds from disposal of property and equipment	2		6
Other investments	6		(2)
Cash required for investing activities	(1,305)		(2,821)
Financing activities


Reductions of long-term debt	(1,076)		(72)
Dividends paid	(1,017)		(996)
Repurchase of stock	(155)		—

Shares withheld for taxes on share-based compensation	(94)		(121)

Cash required for financing activities	(2,342)		(1,189)
Net decrease in cash and cash equivalents	(308)		(612)
Cash and cash equivalents at beginning of period	3,805		2,229
Cash and cash equivalents at end of period	$	3,497	$	1,617
Supplemental information
Leased assets obtained in exchange for new finance lease liabilities	$	304	$	20
Leased assets obtained in exchange for new operating lease liabilities	362		337

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q2 2024 Form 10-Q			4


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Shareholders’ Investment
	Common	Stock		Additional				Accumulated Other
	Stock	Par		Paid-in		Retained		Comprehensive
(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total
January 28, 2023	460.3	$	38	$	6,608	$	5,005	$	(419)	$	11,232
Net earnings	—	—		—		950		—		950
Other comprehensive loss	—	—		—		—		(3)		(3)
Dividends declared	—	—		—		(507)		—		(507)


Stock options and awards	1.3	—		(67)		—		—		(67)
April 29, 2023	461.6	$	38	$	6,541	$	5,448	$	(422)	$	11,605
Net earnings	—	—		—		835		—		835
Other comprehensive loss	—	—		—		—		(3)		(3)
Dividends declared	—	—		—		(516)		—		(516)

Stock options and awards	—	—		69		—		—		69
July 29, 2023	461.6	$	38	$	6,610	$	5,767	$	(425)	$	11,990
Net earnings	—	—		—		971		—		971
Other comprehensive loss	—	—		—		—		(5)		(5)
Dividends declared	—	—		—		(513)		—		(513)


Stock options and awards	0.1	—		71		—		—		71
October 28, 2023	461.7	$	38	$	6,681	$	6,225	$	(430)	$	12,514
Net earnings	—	—		—		1,382		—		1,382
Other comprehensive loss	—	—		—		—		(30)		(30)
Dividends declared	—	—		—		(514)		—		(514)

Stock options and awards	—	—		80		—		—		80
February 3, 2024	461.7	$	38	$	6,761	$	7,093	$	(460)	$	13,432


TARGET CORPORATION						Q2 2024 Form 10-Q			5


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Shareholders’ Investment
	Common	Stock		Additional				Accumulated Other
	Stock	Par		Paid-in		Retained		Comprehensive
(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total
February 3, 2024	461.7	$	38	$	6,761	$	7,093	$	(460)	$	13,432
Net earnings	—	—		—		942		—		942
Other comprehensive loss	—	—		—		—		(